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TMI Blog2013 (5) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... NVAT credit on capital goods/inputs on the one hand and on input services on the other. The amount of CENVAT credit denied on capital goods/inputs is Rs. 44,16,292/- and the amount of CENVAT credit denied on input services is Rs. 3,14,27,009/-. The items on which total CENVAT credit of Rs. 44,16,292/- was taken by the appellant are HR Plates, MS Plates, Rails and MS Pipes. They claimed these items to be capital goods and accordingly took CENVAT credit in the relevant register. When the credit was proposed to be denied in the relevant show-cause notice on certain grounds alleged by the department, the appellant, alternatively, pleaded in their reply to the show-cause notice that, if the above items could not be classified as capital goods un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both quantity and value and further that the above services did not have any nexus with the setting up of the cement manufacturing plant. In their reply to the show-cause notice, the party pleaded that all the services were used in connection with the setting up of their plant. They also endeavoured to clarify the corrections of quantity and value in the invoices. They submitted that all the corrections were made so as to record lower figures of quantity and value of the services received so that the correct amount of CENVAT credit could be taken. These submissions/ clarifications of the appellant also did not impress the adjudicating authority. In the result, the entire CENVAT credit came to be denied to the appellant. The learned counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we have perused, did contain specific denial of the relevant allegations raised in the notice and also contained specific pleadings regarding the manner of use of HR Plates, MS Plates etc. We also find that several photographs were produced by the appellant in a bid to show to the adjudicating authority that the plates, pipes etc. were used to fabricate various items of capital goods in connection with setting up of the cement factory. The learned Commissioner appears to have seen these photographs, but she recorded her inference to the effect that the photographs indicated iron and steel structural support to machinery having been fabricated from plates, pipes etc. These photographs are available on record and we have seen them. Indeed, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y contentious and, therefore, it is incumbent on the adjudicating authority to re-examine the issue and render a correct decision thereon. The adjudicating authority has got to examine whether HR Plates, MS Plates and Pipes etc., which are claimed by the appellant to have been used in the manufacture of capital goods in connection with setting up of their cement plant, would fall in the exclusion part of the 2nd explanation to the definition of input. If these items cannot fall in the exclusion part of the explanation, they might be covered by the definition of input provided, of course, they were used for manufacture of machinery (capital goods). In any case, it is up to the appellant to establish their case before the adjudicating authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te in this case is, entirely, prior to April 2011 and therefore it was incumbent on the Commissioner to consider whether the aforesaid services were, in fact, used in or in relation to the setting up of the cement factory. Of course, the burden is on the appellant to prove that the services were used in or in relation to the setting up of the cement factory. They set up such claim in their reply to the show-cause notice, but the adjudicating authority held that no nexus was established between any of the above services and the manufacture of cement. It appears, this finding was recorded without due regard to the fact that setting up of factory was one of the aspects expressly mentioned in the inclusion part of the definition of input servic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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